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A review of the fine-looking book which concludes (surprise, surprise) that big money in elections rules.

From the review…
“Thomas Ferguson has worked for fifteen years to make two claims about democracy in the United States. First, ‘rule by the people’ is a sham, and always has been. Second, the social ‘sciences’ have badly botched the job of finding out why. Golden Rule is a collection of some highlights of this work, and anyone who wants to understand politics in America ought to read it.”

The Act created a largely corporate controlled national banking and currency system. It was a major coup for banking corporations through the establishment of a private central bank authorized to “monetize” government debt (i.e. to print their own money and exchange it for government securities or I.O.U.’s).

The central banking system was composed of 12 regional private/corporate banks owned by participating commercial banks. All national banks were required to join the system. Banking corporations now controlled the issuance and circulation of our national currency…as debt. By controlling our national money faucet, they could create inflation and deflation.

This corporate monopolization of our currency allowed for public regulation, but not control. It was now banking corporations, not the US government as stipulated in the U.S. Constitution, which was in control of the national currency, with 97% of our money created as debt by banking corporations.

As for the Fed’s record, the dollar has lost over 95% of its value since 1913, the greatest depression the nation has even experienced occurred in the 1930’s and the Fed is in the midst of printing historic sums of money ($85 billion per month, which was just “tapered” to a mere $75 billion per month as of last week) out of thin air under their Quantitative Easing (QE) program, which has been largely invested in the major banks to offset their trillions of dollars worth of toxic assets and fuel a stock market “bubble.”

“It must not be felt that the heads of the world’s chief central banks were themselves substantive powers in world finance. They were not. Rather they were the technicians and agents of the dominant investment bankers of their own countries, who had raised them up, and who were perfectly capable of throwing them down. The substantive financial powers of the world were in the hands of these investment bankers who remained largely behind the scenes in their own private banks.” – Carroll Quigley, Tragedy And Hope

“When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it.” – Frederic Bastiat

1. In 1985, there were more than 18,000 banks in the United States. Today, there are only 6,891 left.

2. The six largest banks in the United States (JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley) have collectively gotten 37percent larger over the past five years. This after the 2008 economic implosion caused by reckless lending practices of the largest banks which used much of their taxpayer bailout money to acquire smaller banks, becoming ever more economically and politically powerful.

3. The U.S. banking system has 14.4 trillion dollars in total assets. The six largest banks now account for 67 percent of those assets and all of the other banks account for only 33 percent of those assets.

4. JPMorgan Chase is roughly the size of the entire British economy.

5. The five largest banks now account for 42 percent of all loans in the United States.

6. Right now, four of the “too big to fail” banks each have total exposure to derivatives that is well in excess of 40 trillion dollars. The total exposure alone that Goldman Sachs has to derivatives contracts is more than 381 times greater than their total assets.

7. According to the Bank for International Settlements, the global financial system has a total of 441 trillion dollars worth of exposure to interest rate derivatives.

8. Congress gave up their Constitutional authority to issue and circulate money to banking corporations with passage of the Federal Reserve Act 100 years ago on December 23, 1913. Banking corporations now issue most of the money in the US via loans (which is debt), including loaning money to the US (instead of the US issuing its own money debt free).

9. The financial sector is far and away the largest source of campaign “contributions” (more accurate word is actually “investments”) to federal candidates and parties (both Republicans and Democrats), with insurance companies, securities and investment firms, real estate interests and commercial banks providing the bulk of that money.

10. “The very idea of a government that can create money for itself, allowing banks to create money that the government then borrows, and pays interest on, is so preposterous that it staggers the imagination. Either everyone in government in charge of the procedure is lacking in intelligence or they have been bought and paid for by those who profit from their skullduggery and their infidelity to the public interest.” — William Hixson, Economist

We must democratize our national money (monetary) system and break up the big banks.

[Sources: Points 1-7 are from http://theeconomiccollapseblog.com/archives/83-numbers-from-2013-that-are-almost-too-crazy-to-believe; point 9 is from OpenSecrets.org]

Toobin is a smart guy. This is an interesting article. Below are several selections that stood out as I read it.

However, there are several glaring omission in his analysis. Nothing is mentioned of the role artificial legal entities (i.e corporations) and money being defined as free speech — both the result of U.S. Supreme Court decisions — have contributed to government “brokenness,” nor the national Move to Amend movement.

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Sanford Levinson, professor of law, University of Texas and visiting professor, Harvard Law School: “The Constitution [places] almost insurmountable barriers in the way of any acceptable notion of democracy.”
“[T]he constitution is both insufficiently democratic, in a country that professes to believe in democracy, and significantly dysfunctional, in terms of the quality of government that we receive.”

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In creating the national legislature, the delegates to the Constitutional Convention had to address the issue of slavery. “The Southern states wanted them to be included in the calculation of the over-all population, in order to boost the region’s representation in the House. The North thought that the slaves should not count at all. In a way, the negotiated solution reflected the shameful reality, that slaves in the United States were judged less than fully human. The standoff led to a notorious compromise: for purposes of apportioning seats in the House, each slave would count as three-fifths of a person.”

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“The process that produced the Senate in understandable,” Sanford Levinson said, “but the end result is indefensible.” The distortion created by small states having and equal number of senators has dramatically worsened over the centuries.

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Mark Levin of the Landmark Legal Foundation has proposed a series of “Liberty Amendments.” Among them is a Constitutional Amendment that would allow three-fifths of the states to overrule any federal legislation.

Steven Calabresi, a professor of law at Northwestern University and a co-founder of the Federalist Society: “I would also allow Congress, by a two-thirds vote of both houses, to override Supreme Court decisions in the same way in which it can override Presidential vetoes.”

Randy Barnett, a professor at Georgetown University Law Center, created a “Bill of Federalism.” Among them is a Constitutional Amendment that would allow “half of the states (provided that they represent half of the national population) to rescind any federal law.”

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Stanley Levinson: “…I do think the republican form of government imagined by Madison and his friends was extraordinarily fearful of any kind of rule by the people. They really didn’t have any confidence in citizens. But what Randy [Barnett] finds himself defending is a veto by small, basically rural states, who ought not be subjected to the majority rule by people who live in cities. This is one of the great American fault lines.”

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The Constitution may be amended, but the process is arduous. According to Article V, any amendment must receive the endorsement of two-thirds of the House and Senate and three-quarters of the state legislatures. Article V also limits any change in the makeup of the Senate.

To Levinson, the difficulty of the amendment process is one of the document’s critical defects. ‘You have a situation where legislators representing less than one-tenth of the population of the country can stop any amendment,’ he said. ‘That’s completely undemocratic.’”

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For partisans on the left and the right, it’s tempting to see constitutional amendments as shortcuts to political gain. But the difficulty of the process makes that impossible. Political change leads to constitutional amendments; amendments do not lead to political change.

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The Constitution can and often does change without being formally amended. This is the real lesson of the past decade or so. Levin and his Tea Party followers have shown that agitation about the Constitution can serve a conservative political agenda. In everything from television advertisements to law-review articles, they made the case that the Second Amendment protects an individual’s right to bear arms-a concept that the Supreme Court emphatically rejected in the past.

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There is nothing inherently conservative about the honorable and long-held idea that citizens can understand, and even change the meaning of the Constitution. Liberals, despite themselves, have proved the same point. Plessy v. Ferguson (1896), which condoned racial segregation, gave way to Brown v. Board of Education (1954), which ended it. As recently as 1986, the Court dismissed the idea that the Constitution protected gay people from discrimination as, “at best, facetious.” Today, that principle is enshrined in the bedrock of constitutional law. And the Court’s decisions have accomplished most, if not all, of what the Equal Rights Amendment was supposed to do for women’s rights. Judicial appointments played a role, but more important was the demand from an engaged populace.

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The compromises, misjudgments and failures of the men in Philadelphia haunt us still today…On some occasions, as with race and gender discrimination, the Constitution is renewed and improved in courtrooms; on others, as with the Senate’s recent act of self-improvement, the government finds ways to repair itself. In all events, the roots of these changes are the same. The Preamble of the Constitution says nothing about judges or politicians. It invokes what should be the true and ultimate authority in American government. We the People.

Proposed federal Food Stamp cuts and ending the extension of unemployment insurance are the latest assaults on the poor and working class – part of a growing attack by the 1% on the 99% to cut essential funding and prevent wage increases in the name of “austerity” for the purpose of “reducing the national debt.” In reality, these are political and media-echoed diversions and distractions to maintain low tax rates for the 1%, loopholes and subsidies for major corporations, and unending military spending.

Big Agricultural and crop insurance corporations are protected in the federal Farm Bill, but not 47 million who already receive inadequate amounts of Food Stamps. The choice is not between family farmers vs food stamp recipients but rather helping the poor and low income workers on food stamps vs throwing money at agricultural and crop insurance corporations.

Ending the extension of unemployment insurance will impact 5 million jobless workers – people who in our rough economy haven’t been able to find work, but nevertheless will be punished by receiving less funds for basic needs.

Food Stamps and Unemployment Insurance are not the reasons for the growing national debt.

Recipients of food stamps and unemployment insurance immediately spend their benefits. This helps:
– Maintain their own health (thus avoiding added costs to the health care system)
– Improve education (hungry children don’t learn as well in school) and
– Stimulate our economy (a dollar in SNAP/Food Stamp spending yields about $1.70 in economic activity, one of the highest multiplier effects of any government program).

The lies, myths and stereotypes about food stamps and unemployment insurance created and perpetuated by the corporate media must end. We must tell the truth.

Austerity must be countered by prosperity. There are sufficient resources to feed and care for everyone, to supply everyone with a job. We have less a money problem than a priorities problem.

It’s up to the 99% to educate, advocate and organize for justice. Movements against austerity are growing globally. We can’t rely on politicians, corporate CEOs or media exposes to bring justice and fairness. We must build diverse, independent and democratic grassroots labor-community movements for prosperity, not austerity.